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- Brazilian regulators noted that USDT use has gained traction in recent years.
- The regulators estimated USDT’s trade volume to be over $54 billion in mid-October.
- The stablecoin accounted for 80% of all cryptocurrency transactions in the country since the start of 2023.
In a recent report, regulators in Brazil have noted the rapid rise in USDT’s trading volume in the country. According to Brazil’s Federal Reserve, monthly surveys conducted since 2019 indicate significant growth in the use of USDT and other stablecoins.
According to the report, USDT, issued by Tether, has grown immensely in recent years. As a result, the token’s trading volume has soared and surpassed that of major cryptocurrencies. They also listed USDC and BRZ, Brazilian Digital Token, a stablecoin fully backed by the Brazilian Real, as stablecoins to have gained traction.
Regulators in Brazil said the rise in the use of stablecoins is because of the stability and security of value they offer. Thus, users who use stablecoins do so to avoid the market volatility often associated with most cryptocurrencies.
Furthermore, the regulators said USDT’s trading volume reached over $54.5 billion (R$271 billion) as of mid-October 2023. On the other hand, Bitcoin registered a trade volume of around $34 billion during this same period.
In addition, the report also showed that USDT has taken a significant share of the crypto market since the start of 2023. Indeed, the stablecoin accounted for 80% of the reported cryptocurrency movement. At the same time, BTC, ETH, and XRP trade volumes in the country plummeted.
Movement of the main cryptocurrencies per year. Source: gov.br
According to Brazilian tax authorities, the sudden rise in the use of stablecoins deserves regulatory attention. They emphasized that the continued use of USDTs could have significant implications for tax purposes and crypto regulations in the South American country.
In the same tune, the report also referenced an IMF report that warned countries about stablecoins. Notably, the IMF said stablecoins could “replace national currencies and impact countries’ fiscal and monetary policies, especially in developing economies.” CoinMarketCap’s data shows that USDT is the third-largest cryptocurrency network with a market cap of $84 billion.
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